The stock markets remained in a “digestion” phase again last week as the gains from the prior months were considered against the context of the larger bear market. The markets have been bouncing within a particular range recently, seemingly experiencing an endless churn around current levels. Bonds, however, had quite a move with longer-maturity issues advancing strongly. (more…)

This week’s scribe is on adaptation. We wrote in the summer of 2008 that the cure for high oil prices was high oil prices, as the more it costs us to buy gas, the more we consciously attempt to conserve. The more we conserve, the lower the demand, and therefore, prices should eventually come down. (more…)

There has been quite a bit of conversation over the last few months (and years) about the future of the dollar. The dollar bears—those who think the dollar will weaken versus other major currencies—have gotten much louder lately. Indeed, China (a very large holder of U.S. debt) has raised concerns about the path of U.S. debt policy, and many relevant emerging market countries have made it known publically that they are diversifying their reserves to hold IMF (International Monetary Fund) bonds. The IMF is mostly funded by the U.S. (more…)

The May unemployment report came out last Friday, and the news was “good”…I guess. The news wasn’t actually good, as the Bureau of Labor Statistics (BLS) reported that 345,000 Americans lost jobs last month. Historically speaking, this is not a good number, as monthly job losses over 200,000 have been highly correlated with recession. In this new environment where “less bad” equals good, however, the losses of 345,000 were viewed as somewhat encouraging. At least they weren’t 600,000 anymore, right? (more…)

U.S. Treasury Secretary Tim Geithner flew to China over the weekend to discuss a number of issues with Chinese officials. The key issues of concern to both countries remain currency policy, the worldwide recession and China’s large holdings of U.S. government debt. Each country’s concerns, however, come from very different perspectives. (more…)